Developers sue over road, drainage taxes

NORTH PORT -- Three Thomas Ranch developers have filed a suit against the city, claiming they have been illegally taxed hundreds of thousands of dollars for roads and drainage.

According to the lawsuits, filed by Divosta Homes, Gran Paradiso and Forth Quarter Properties, the road and drainage assessments are illegal.

At issue is when the city can start taxing property owners in the development.

Jeff Boone, the attorney representing the West Villages at Thomas Ranch, but who did not file the lawsuits, said there are no city roads in the development and when the year began, there were no residents, so the assessments should not apply.

"First of all, it's clear to us somebody in the city of North Port made a mistake on the assessments," said Boone. "At the point in time that you make the decision about the assessments, there was nobody living out there. Secondly, there are no roads, no city roads out there."

City Manager Steven Crowell said there is some merit to Boone's argument, but said assessments are used for streets not only within a certain area, but throughout the city.

"Taxes that people pay are not only for the portion of road in front of their house, but are for the entire city," said Crowell.

The assessments in question, more than $2 million, were planned for in the city's budget.

The city commission will instruct the city attorney how to handle the suit during a meeting Monday.

Boone said he believes the matter can be settled out of court. The city attorney would not comment on the case.

The roads that have been constructed were paid for by a special taxing district, called the West Villages Improvement District, that was approved by the state Legislature in 2004.

Boone said that roads and a storm-water facility have been and will continue to be built and maintained by the improvement district.

Homeowners, in addition to regular taxes, will pay fees for sewers, roads, the water plant, parks and other services through the West Villages district.

Complicating matters is the fact that a post-annexation agreement between developers and the city has yet to be signed, even though building has already started and the 7,800-acre tract of land was annexed in 2002.

That agreement would specify when the city would start assessing taxes on the West Villages development.

For instance, the city has an agreement with another large-scale development, Isles of Athena, that stipulates the property will be assessed as soon as development begins.

"Isles of Athena, they've got a specific time frame on taxing for them," Crowell said.

"Part of what the problem is here, there is no annexation agreement."

And without a post-annexation agreement signed, it is unclear when the assessments will be paid and how the city will handle the legal challenge.